Allahabad High Court
U.P. Handicraft Development & ... vs Daya Ram Yadav & 3 Others on 5 September, 2019
Bench: Pankaj Kumar Jaiswal, Jaspreet Singh
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH Court No. - 1 Case :- SPECIAL APPEAL No. - 341 of 2017 Appellant :- U.P. Handicraft Development & Marketing Corp. Thru. M.D. Respondent :- Daya Ram Yadav & 3 Others Counsel for Appellant :- Shobhit Mohan Shukla Counsel for Respondent :- Pradeep Raje Hon'ble Pankaj Kumar Jaiswal,J.
Hon'ble Jaspreet Singh,J.
(1) None is present on behalf of the respondents.
(2) Heard Sri Shobhit Mohan Shukla, learned counsel for the appellant and perused the record.
(3) This special appeal under Chapter VIII, Rule 5 of the Allahabad High Court Rules, 1952 has been filed by U.P. Handicraft Development & Marketing Corporation through its Managing Director against the judgment and order dated 7.7.2017 passed in Writ Petition No. 896 (S/S) of 2001 : Daya Ram Yadav Vs. State of U.P. and 4 others, whereby the learned Writ Court allowed the writ petition by modifying the relief of reinstatement and directed that the appellants herein will pay a lump sump compensation of Rs.5,00,000/- (Rupees Five Lakhs) to each of the petitioners within a period of one month from the date of a certified copy of the order is served upon the Managing Director, U.P. Export Corporation Ltd., Lucknow.
(4) Brief facts of the case are that the appellant-Corporation initiated retrenchment proceedings of its employees, which were rejected vide orders dated 7.4.1999 and 22.4.1999. Thereafter, on 24.1.2000, second proceedings for retrenchment were again initiated. For this purpose, permission as per Section 25 (1) (c) of the Industrial Disputes Act, 1947 was sought from the Additional Labour Commissioner.
(5) Before the Additional Labour Commissioner, a preliminary objection was raised by employees with regards to maintainability on the ground that the second application has been filed within a period of one year from the decision on the earlier application. During the course of hearing, it was submitted by the employers that they have already floated the VRS which has not been accepted by the employees sought to be retrenched and in case VRS scheme is accepted by the employees, there would be no requirement of any retrenchment. The stand of the employees was that in case they are offered the benefits of 5th Pay Commission with effect from 01.01.1996 while calculating their VRS benefits, they would be willing to accept the VRS.
(6) The Additional Labour Commissioner, on going through the stands of the parties, noted that at the time of hearing, the Management representative consented that if the employees will apply for revision of their benefits under 5th Pay Commission w.e.f. 01.01.1996, the Board of Directors shall, with the consent of the State Government, accept the same. The employees also agreed, hence, the Additional Labour Commissioner directed the Management to grant VRS to the petitioners taking decision on granting benefits of 5th Pay Commission w.e.f. 01.01.1996.
(7) As no decision was taken by the Management relating to grant of benefits of 5th Pay Commission, therefore, the writ petitioners were made to submit applications under VRS, which they made on 12.10.2000, 31.10.2000 and 08.11.2000. In the said applications, it was prayed that they should be paid the benefits of Vth Pay Commission w.e.f. 01.01.1996 as per orders of Additional Labour Commissioner. The said VRS applications were accepted vide letter dated 09.11.2000 and directed that writ petitioners would be treated as relieved with effect from 15.11.2000.
(8) On 14.11.2000, the writ petitioners Faxed Letters to the Managing Director, specifically stating that in the VRS, their benefits have not been specifically calculated and further informed that VRS is not acceptable without the benefits of 5th Pay Commission given to the writ petitioners. On 15.11.2000, the writ petitioners were relieved ignoring their conditions and without calculating their benefits as per recommendations of 5th Pay Commission.
(9) The stand of the appellants/respondents is that in the Board of Directors meeting dated 16.11.2000, the request of employees for applying 5th Pay Commission was rejected and the same was communicated to the writ petitioners by letters dated 17.11.2000 and 22.11.2000.
(10) From the perusal of the record, it is clear that till the time VRS was offered, accepted, and writ petitioners were relieved the Management, despite order of Additional Labour Commissioner had not taken decision regarding application of 5th Pay Commission and writ petitioners were kept in dark by the Corporation.
(11) The learned Writ Court, on considering the aforesaid facts and placing reliance upon Keshav Mill Co. Ltd. Vs. Union of India : 1973 (1) SCC 380, K.I. Shephard Vs. Union of India : 1987 (4) SCC 431, A.K. Kraipak & others Vs. Union of India & others : (1996) 2 SCC 262, Kumaon Mandal Vikas Nigam Ltd. Vs. Girja Shankar Pant : 2001 (1) SCC 182 and State of Tamil Nadu Vs. K. Shyam Sundar : 2011 (8) SCC 737, observed that it was incumbent upon the Corporation to come out with a VRS containing clear terms and conditions, specifically informing its employees the benefits which they would get under the VRS. It can neither be expected from employees on the VRS forms and then decide the conditions of VRS to their detriment.
(12) The learned Writ Court has further opined that acceptance to VRS from employees was obtained in the month of October and in the beginning of November, 2000. The said forms were accepted and orders were passed relieving the employees with effect from 15.11.2000. Till 15.11.2000 when the employees were being relieved, neither Corporation had taken decision nor the employees were made aware as to what benefits they would get under the VRS.
(13) Considering the aforesaid facts, the learned Writ Court has observed that the decision in the Managing Committee meeting for the first time was taken on 16.11.2000, which cannot be called an honest and transparent approach by the Corporation. If the decision was taken on 16.11.2000, it was incumbent upon the Corporation to make fresh offers to the employees and ask them and if they would be willing for VRS in the given situation, however, in a grossly arbitrary manner, the Corporation first relieved the employees and thereafter took decision to their detriment. In these backgrounds, the learned Writ Court finally came to the conclusion that the said conduct on the part of the respondents/appellants herein is violative to the spirit of Article 14 of the Constitution of India, therefore, the writ petition was allowed vide judgment and order dated 7.7.2017, which is impugned in the instant appeal. The relevant portion of the judgment and order dated 7.7.2017 reads as under :
"In the present case, acceptance to VRS from employees was obtained in the month of October and in the beginning of November, 2000. The said forms were accepted and orders were passed relieving the employees with effect from 15.11.2000. Admittedly, till that date i.e. 15.11.2000 when the employees were being relieved, neither Corporation had taken decision nor the employees were made aware as to what benefits they would get under the VRS. Admittedly, the decision in the Managing Committee meeting for the first time was taken on 16.11.2000. This cannot be called an honest and transparent approach by the Corporation. If the decision was taken on 16.11.2000, it was incumbent upon the Corporation to make fresh offers to the employees and ask them and if they would be willing for VRS in the given situation. However in a grossly arbitrary manner, the Corporation first relieved the employees and thereafter took decision to their detriment. The said conduct of respondents is violative to the spirit of Article 14 of the Constitution of India. Hence, the writ petition deserves to be allowed.
It is submitted on behalf of the Corporation that the Corporation is suffering huge loss and that long back respondents relieved the petitioners, therefore, they cannot be taken back again. The counsel for petitioners states that due to arbitrary conduct of respondents petitioners have lost many years of salary, they would have got till their regular retirement.
Looking to the facts and circumstances of the case, it would be appropriate to modify the relief of reinstatement to directing that the respondents will pay a lump-sump compensation of Rs.5,00,000/- (five lacs) to each of the petitioners within a period of one month from the date a certified copy of this order is served upon the respondent-2, Managing Director, U.P. Export Corporation Ltd., Lucknow.
With aforesaid observations and directions, the writ petition is allowed."
(14) Learned counsel for the appellant on drawing attention of the judgment of Apex Court in Balbir Singh Negi Vs. Union of India : (1996) 8 SCC 283, Vice-Chairman and Managing Director, APSIDC Ltd. Vs. R. Varaprasad : 2003 (11) SCC 572, Bank of India Vs. O.P. Swarnkar : 2003 (2) SCC 721, P.N.B. Vs. V.K. Goel : 2004 (2) SCC 193, Punjab & Sind Bank Vs. S. Ranveer Singh Bawa : (2004) 4 SCC 484, Bank of India Vs. Pale Ram Dhania : 2004 (9) SCC 36, and has submitted that the writ petitioners while opting for VRS were fully aware that till that time the recommendations of 5th Pay Commission were not implemented so far as the employees of the Corporation are concerned. Furthermore, when the terminal benefits were utilized by the respondents, there was no occasion for the learned Writ Court to have accepted their claim. Thus, learned Writ Court erred in passing the impugned order.
(15) It is well settled that natural justice co-exists with and reflects a wider principle of fairness in decision making and that all judicial and administrative decision-making have a duty to act fairly. Furthermore, fair play is a part of the public policy and is a guarantee for justice to citizens. In our system of Rule of Law every social agency conferred with power is required to act fairly so that social action would be just and there would be furtherance of the well-being of citizens. The rules of natural justice have developed with the growth of civilisation and the content thereof is often considered as a proper measure of the level of civilization and Rule of Law prevailing in the community. Man within the social frame has struggled for centuries to bring into the community the concept of fairness and it has taken scores of years for the rules of natural justice to conceptually enter into the field of social activities.
(16) We find that after going through the record, the learned Writ Court opined that VRS from employees was accepted in the month of October and in the beginning of November, 2000. The said forms were accepted and orders were passed relieving the employees with effect from 15.11.2000. Admittedly, till that date i.e. 15.11.2000 when the employees were being relieved, neither Corporation had taken decision nor the employees were made aware as to what benefits they would get under the VRS. Admittedly, the decision in the Managing Committee meeting for the first time was taken on 16.11.2000, which cannot be called an honest and transparent approach by the Corporation. In these backgrounds, the learned Writ Court was of the opinion that if the decision was taken on 16.11.2000, it was incumbent upon the Corporation to make fresh offers to the employees and ask them and if they would be willing for VRS in the given situation. However, in a grossly arbitrary manner, the Corporation first relieved the employees and thereafter took decision to their detriment. Thus, the said conduct of respondents/appellants herein is violative to the spirit of Article 14 of the Constitution of India.
(17) On due consideration, we are of the view that the decisions cited by the learned counsel for the appellants are distinguishable on the facts and circumtances of the case.
(18) From the aforesaid, there is no legal error apparent on the face of record in passing the impugned order by the learned Writ Court.
(19) The special appeal lacks merit and is, accordingly, dismissed but there shall be no order as to costs.
(Jaspreet Singh, J.) (Pankaj Kumar Jaiswal, J.)
Order Date :- 5.9.2019
Ajit/-